Whether MS wants to roll out 7.8 or not, it still ultimately has to go through the carriers. Since carriers like for people to get new phones with service contracts attached, keeping WP7 alive is not in their best interest. So they may have collectively decided to either put insufficient resources toward 7.8 or to kill it altogether.

I believe 7.8 is destined to be OTA when it is ultimately released. Whenever that will be.

It has it's place in the low end market.

I never did think about this. I thought for sure WP8 would be able to run on low end devices, and I thought there were a few Nokia?

I don't think 7.8 is all that great of an update. A lot of people were hoping that 7.8 would bring all the features and functionality that are severely lacking in Windows Phone 7, but the update is little more than an updated start screen UI and bluetooth file transfer support. I was really excited for 7.8 until it started being released and I realized it didn't address 95% of the issues I had with my Lumia 900. Microsoft once said that Windows Phone 7 was what Windows Mobile should have been, and then they said that Windows Phone 8 is what Windows Phone 7 should have been. It's just been a terrible journey and a constant letdown for many WP7.x users and I'll never buy another Windows Phone...I won't even consider it. I find it to be a sad little OS lacking a lot of basic functionality. I feel similarly about Windows Phone 8. I could list all my complaints, but thousands of others already have. http://windowsphone....ure-suggestions That's where everyone's WP7.x hopes and dreams went to die. Microsoft didn't listen to them.

I think 7.8 is a great update, but could be much better. Really, all I'm missing is background VOIP. Other than that, I'm loving 7.8. There is absolutely no way I could go back to the old start screen.

67% of WP users are still on 7.5 phones. That 8% 900 users? They've got at least 1.5 years left on their contract. Most of the rest have been released in the last year and a half, which means they have at least a year left on their contract. I see no reason to abandon them.

I dunno. You think? (Honest question) Personally, I think by this point it's a lost cause, with many already having got their upgrade, or will be getting it soon. Better for Microsoft just to focus on WP8, and getting updates for that out the door on time.

A lot of folks bought the Lumia 900 less than a year ago. They have over a year left on their contracts.

Correct me if I'm wrong here but wouldn't a company that is currently trying to get their newest phone OS off the ground at least "try" to support (to some extent) their previous OS by releasing their much hyped upgrade in a timely manner thereby keeping their current customers happy?
This entire 7.8 debacle reeks of fail by microsoft, if I owned a lumia 900 or titan or whatever and I am on the fence about continuing the microsoft relationship when it comes time to upgrade this whole WP7.8 fail would definitely push me in the direction of either android or ios without a doubt.